Understand the true value and utility of the MTRc token
William Mougayar wrote a great article on tokenomics. He points out that many so-called ‘utility tokens’ don’t provide utility. Many projects do not evaluate the use of their token properly, resulting in a non-utility token being sold as a utility token.
We, ModulTrade, want to show the true value of our token by answering a selection of questions from William his article on ‘Tokenomics’ (1). We will answer each questions with Yes/No and provide a short explanation.
- Is the token tied to a product usage, i.e. does it give the user exclusive access to it, or provide interaction rights to the product? Yes.
It is the key to transact in ModulTrade (MT) Value Ecosystem, as all fees on trade contracts on MT platform will have to be paid in MTRc. ModulTrade builds a value ecosystem for global trade, i.e. a digital networked value structure that is real-time, global, connected, digital and cost-effective.
2. Does the token grant a governance action, like voting on a consensus related or other decision-making factor or does it grant an ownership of sorts? No.
The MTRc token gives no rights in ModulTrade company and doesn’t represent participation in the company.
3. Does the token enable the user to contribute to a value-adding action for the network or market that is being built? Yes.
For instance, third parties could build solutions within ModulTrade Value Ecosystem and on top of MT platform, whose usage will be charged in MTRC. It will also enable third-party developers / service providers to gain access to a wider target of users / clients, while reducing development and user acquisition costs.
4. Does the token result in a monetizable reward based on an action by the user (active work)? No.
There’s no reward for mining or other active work by the users. The value of MTRc token is determined by pure market forces (supply and demand). It is nothing like an equity stake that could entitle you to dividends.
5. Does the token grant the user a value based on sharing or disclosing some data about them (passive work)? Yes.
If we approach from that point that MTRc is the entry key to our ecosystem, then if we share someone’s data in our ecosystem it indirectly brings value to the token holder as the track records can provide more accurate risk profiling for lenders thus lower interest rates for users.
6. Is buying/selling something part of the business model and can users create a new product or service? Yes.
ModulTrade is a multi-sided platform business model; in order to work properly buyers and sellers must buy/sell their goods and third-party users must provide services / solutions that enrich the ecosystem.
7. Is the token required to run a smart contract? Yes.
8. Is the token required as a security deposit to secure some aspect of the blockchain’s operation? Yes.
There’s an escrow-account mechanism to provide trust between the buyer and the seller, and as well create a secure environment. The token will be staked in the smart contract which acts as an escrow agent.
9. Is the token used to pay for some usage? Yes.
Trade fees and usage of third-party solutions on the platform will be charged in MTRc.
10. Is the token required to join a network or other related entity? Yes.
The token is required to transact on the platform.
11. Is the token given away or offered at a discount, as an incentive to encourage product trial or usage? Yes.
12. Is the token your principal payment unit, essentially functioning as an internal currency? Yes.
Trade fees and usage of third-party solutions on the platform will be charged in MTRc as its the internal currency for MT platform.
13. Does your blockchain autonomously distribute profits to token holders? No.
Profits are not shared to token holders; the MTRc token gives no rights in ModulTrade company and doesn’t represent participation in the company.
Conclusion
The MTRc token is clearly a utility token being used as an internal currency within the ModulTrade Value Ecosystem. It will be used as well for charging usage fees for third-parties’ solution built around ModulTrade Service Platform. The token doesn’t return you dividends and as well doesn’t give you rights in ModulTrade, as that’s the definition of an equity token.
(1) William Mougayar — https://medium.com/@wmougayar/tokenomics-a-business-guide-to-token-usage-utility-and-value-b19242053416
